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Council approves a two-year contract extension for city manager at Tuesday, Nov. 20 meeting

By Eric Heinz

San Clemente City Council decided to backtrack on its proposal to increase severance benefits for its city manager following the outcry of at least 15 public speakers at the Tuesday night council meeting, Nov. 20.

The city council was required to review and approve the contract for City Manager James Makshanoff as it expires this year. The new contract is for another two-year period.

The initial contract amendments included increases to the manager’s severance package in which Makshanoff, if terminated between now and June 2021, would receive 18 months of his base pay; if terminated between 2021 and 2022, he would receive 15 months of it; and after 2022 he would receive 12 months. Monetarily, that would have been about $370,000 for 18 months; about $310,000 for 15 months; and $248,000 for 12 months.

Makshanoff took the position in 2014 and runs the city with Assistant City Manager Erik Sund.

City council also retained the immunity period that prevents the city manager from being terminated 120 days following an election and he could not be suspended, have his resignation requested or his salary reduced during that period. This was the fourth amendment since the contract was executed in 2014.

The current salary of the city manager in San Clemente has been criticized for costing more than manager contracts of cities with double its population.

At least 15 San Clemente residents came to speak either before the regular meeting or the closed session held earlier. You could throw a dart at a list of issues the city of San Clemente faces and hit at least one that was mentioned by public speakers upset with the current city operators.

Former City Councilmember Steve Knoblock said the amendment would be met with a lawsuit if the severance increases remained.

“We see this as a gift of public funds,” Knoblock said. “I think this is inappropriate for this city council in the last moments of their tenure to pass a resolution or amend a contract that would deliver the city manager hundreds of thousands of dollars that no other city manager in this county, or any county for that matter, would be entitled to.”

Incoming City Councilmember Laura Ferguson also weighed in on the position that she will oversee as of December. Ferguson was the city’s public information officer until 2017 and ran a campaign based on more transparency at City Hall.

“It appears this city council is looking to prevent the new city council from implementing positive changes and being fiscally responsible for our city,” Ferguson said, questioning the millions of dollars in legal fees the city has accrued in the last two years or so, as well as other expenses. “The voters have spoken; they want change, and I would encourage you to allow the new city council to make those decisions.”

Resident Jim Bieber returned for his first city council meeting in person in at least 18 months. Back then, he made it a regular appointment to call out issues he had with certain redactions of city documents, emails from councilmembers from which he used to engineer ethics complaints against them and other issues.

His main contention is that the city hasn’t been transparent with about $16,000 in legal fees the city paid to correct a 2016 ballot measure argument, and he’s argued against other redactions in public records requests.

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When the public comment dust had settled, Councilmember Steve Swartz said changes had been made to the original contract and that the severance package would not be increased. He also said Makshanoff’s next performance review will take place in May instead of next fall, a short time after the new city councilmembers—Ferguson and Dane Bane—are sworn in. Councilmember Kathy Ward is the incumbent.

“We’re pulling (the review) up from the fall so that the review process…is taken away from any type of election cycle,” Swartz said. “The contract itself needs to be cleaned up. There’s just a lot of conflicting language in it that needs to be squared away, so we’re doing that at the same time, but there will be no changes to the severance agreements we have on the existing contract.”

Following Swartz’ explanation, local attorney Brad Malamud stood up and accused the city council of committing violations of the Brown Act, the state’s open meetings laws. He was ushered out shortly after that because he was speaking out of turn.

“I want you to discuss this in public before we go into closed session,” Malamud said as sheriff’s deputies escorted him out.

Malamud was later allowed to speak during his allotted time when he reiterated his points.

City Attorney Scott Smith said that the negotiations with Makshanoff had taken place since late summer and that the city did follow the employee confidentiality laws.

Click here to read the full city manager contract amendment.

None of the public speakers came to Makshanoff’s defense, but all five city councilmembers did.

“We benefit from strong city managers in this city,” Mayor Tim Brown said before being interrupted by heckling from the audience. “I personally feel that James has done great work while leading our fight against the (Transportation Corridor Agencies), which has been a very difficult battle. He’s taken a strong leadership on a whole series of issues…in, frankly, a very difficult environment.”

Brown also gave credit to Makshanoff balancing the city’s budget each year, which is headed to an expected deficit with some cuts expected by next year’s cycle.

Councilmember Lori Donchak described Makshanoff as an “extremely focused” individual who kept the city on the right track through myriad issues. She added that his performance review came back with high marks.

“James does know that employee and community relationships are the opportunity areas. Make no mistake about that. We hear you loudly and clearly on that, and we’ve seen the employee survey that was done this year,” Donchak said.

The San Clemente Times requested the most recent employee survey, but it was denied disclosure under personnel file exemptions.

Makshanoff said he had no comment on the matter in response to an email from the San Clemente Times on Wednesday morning.

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